The market is strong, with metal merchants and consumers buying at present. New Zealand merchants are generally reporting steady volumes while consumers are also seeing steady orders. The major issue is transportation, with all those who export and import being affected by shipping disruption. Common complaints surround rolling of bookings, application of surcharges and demurrage issues. Instances have been reported of bookings being cancelled rather than rolled, so this will have a flow in impact with respect to the contractual delivery period.
The market expectation is that New Zealand’s official cash rate will slowly start to increase at some stage next year, and that there is little chance of further depreciation in the foreseeable future. Some of the major banks have already raised interest rates in expectation of this. In Australia, this will be hard to implement given the monetary statements from the Reserve Bank of Australia, but a rise is also expected in the medium term.
Both New Zealand and Australia remain essentially COVID-free and a travel bubble is operating between the two countries. While this has not yet translated into tangible improvements for their respective tourist sectors, this will no doubt be the case in the not-too-distant future.
Hayes Metals (NZL), Vice-President of the BIR Non-Ferrous Metals Division